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PENSION PLANS
 6 Months Ended
Jun. 30, 2012
PENSION PLANS  
PENSION PLANS

14.  PENSION PLANS

 

Central Pacific Bank has a defined benefit retirement plan (the “Pension Plan”) which covers certain eligible employees. The plan was curtailed effective December 31, 2002, and accordingly, plan benefits were fixed as of that date. The following table sets forth the components of net periodic benefit cost for the Pension Plan:

 

 

 

Three Months Ended

 

Six Months Ended

 

 

 

June 30,

 

June 30,

 

 

 

2012

 

2011

 

2012

 

2011

 

 

 

(Dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

Interest cost

 

$

398

 

$

417

 

$

796

 

$

834

 

Expected return on assets

 

(447

)

(457

)

(894

)

(914

)

Amortization of unrecognized loss

 

581

 

550

 

1,162

 

1,100

 

Net periodic cost

 

$

532

 

$

510

 

$

1,064

 

$

1,020

 

 

The fair values of the defined benefit retirement plan as of June 30, 2012 and December 31, 2011 by asset category were as follows:

 

 

 

Level 1

 

Level 2

 

Level 3

 

Total

 

 

 

(Dollars in thousands)

 

June 30, 2012

 

 

 

 

 

 

 

 

 

Money market accounts

 

$

1,488

 

$

—

 

$

—

 

$

1,488

 

Mutual funds

 

454

 

—

 

—

 

454

 

Government obligations

 

—

 

3,438

 

—

 

3,438

 

Common stocks

 

5,795

 

—

 

—

 

5,795

 

Exchange traded funds

 

9,018

 

—

 

—

 

9,018

 

Preferred stocks

 

247

 

—

 

—

 

247

 

Corporate bonds and debentures

 

—

 

3,086

 

—

 

3,086

 

 

 

$

17,002

 

$

6,524

 

$

—

 

$

23,526

 

 

 

 

 

 

 

 

 

 

 

December 31, 2011

 

 

 

 

 

 

 

 

 

Money market accounts

 

$

1,869

 

$

—

 

$

—

 

$

1,869

 

Mutual funds

 

439

 

—

 

—

 

439

 

Government obligations

 

—

 

3,264

 

—

 

3,264

 

Common stocks

 

5,376

 

—

 

—

 

5,376

 

Exchange traded funds

 

8,494

 

—

 

—

 

8,494

 

Preferred stocks

 

226

 

—

 

—

 

226

 

Corporate bonds and debentures

 

—

 

2,891

 

—

 

2,891

 

 

 

$

16,404

 

$

6,155

 

$

—

 

$

22,559

 

 

Our bank also established Supplemental Executive Retirement Plans (“SERPs”), which provide certain officers of our bank with supplemental retirement benefits. The following table sets forth the components of net periodic benefit cost for the SERPs:

 

 

 

Three Months Ended

 

Six Months Ended

 

 

 

June 30,

 

June 30,

 

 

 

2012

 

2011

 

2012

 

2011

 

 

 

(Dollars in thousands)

 

 

 

 

 

 

 

 

 

 

 

Service cost

 

$

—

 

$

—

 

$

—

 

$

—

 

Interest cost

 

107

 

103

 

214

 

206

 

Amortization of unrecognized transition obligation

 

4

 

4

 

8

 

8

 

Amortization of prior service cost

 

5

 

5

 

10

 

10

 

Amortization of unrecognized gain

 

(1

)

(4

)

(2

)

(8

)

Net periodic cost

 

$

115

 

$

108

 

$

230

 

$

216